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Electronic Estate Planning in Uncertain Times

With the growth and progression of technology, the electronic execution of documents relating to Wills and Trusts has lagged behind the times. This delay has proven to be a difficult hurdle for professionals to overcome when the country is experiencing shelter-in-place procedures. Though we are not out and about, the world keeps turning, and the need for properly executed estate planning documents is critical at this time.

The Uniform Electronic Transactions Act (UETA) approved by the Uniform Law Commission in 1999, allows parties to transact business electronically. In 2000, Federal Electronic Signatures in Global and National Commerce Act (ESIGN) was enacted to permit the use of electronic records and electronic signatures to facilitate interstate and foreign commerce by ensuring the validity and legal effect of electronic contracts. However, both the UETA and ESGIN specifically exclude the electronic signing of wills. In July of 2019, the Uniform Law Commission approved the Uniform Electronic Wills Act, also known as the E-Wills Act. This Act permits electronic estate documents such as wills, and allows probate courts to recognize electronic estate documents as being fully valid and enforceable.

Under the E-Wills Act, the electronic signature must be either witnessed or notarized in conformity with state law and maintained in a protective format that is tamper-evident. States have the option to include language that allows remote witnessing. Ultimately, if enacted by individual states, wills executed electronically within that state will be enforceable.

While no state has enacted the E-Wills Act yet, there are several states that have enacted their own similar electronic will signing laws. Arizona, Indiana and Nevada have laws in place that permit electronic Wills and estate planning documents. Florida has a law that will permit electronic Wills effective July 1, 2020. Other states like New York and Connecticut have issued executive orders permitting the temporary electronic notarization and/or execution of Wills during the COVID-19 pandemic.

With the social-distancing requirements, the use of electronic wills is a blessing, but not without its drawbacks. For example, states like Arizona and Indiana require that witnesses be physically present during the electronic will signing. Finding uninterested witnesses during the shelter-in-place can be cumbersome, if not impossible. States like Arizona and Indiana also require that the testator be physically present in the state to use its electronic will statute, which could be difficult for anyone that was forced to shelter-in-place outside of the state.

On the positive note, states like New York and Connecticut (albeit temporarily pursuant to executive orders) allow for remote witnessing via two-way video conference. This is extremely beneficial to the client as estate planners are able to set up group video conferences so the testator, witnesses and supervising attorney are all “present” to execute and witness the estate planning documents.

Florida’s new law, unlike many other states, will allow for non-Florida residents to execute a Florida electronic will.The electronically signed will will be deemed to be executed in Florida if it states that the testator intends to execute and understands that he/she is executing the will in and pursuant to the laws of Florida. This may be desirable for estate planners to entertain the future use of Florida-based planning.

The varying laws for electronic wills among the states have led estate planners to contemplate various creative estate planning techniques. For example, Arizona allows testators physically present in the state to prepare and execute an electronic will, even if they have no other connection than just being present in the state. Arizona’s laws could be used by those living near the border and/or planners who happen to have clients that are presently sheltering-in-place in the state. Nevada also allows non-state residents to prepare execute electronic wills as long as the authoritative copy of the document is in Nevada. These laws assist creative estate planners in protecting their clients’ assets, especially in states that do not permit electronic wills, witnessing and/or notarization during the ongoing COVID-19 pandemic.

If you do rely on one or more of the creative approaches to estate planning, it may be prudent to bring clients back in to your office for another execution once the shelter-in-place procedures are lifted to ensure compliance with your state’s relevant laws and statutes.

Ultimately, we have seen that with the shelter-in-place and social distancing norms, the “old way” of conducting business and executing estate planning documents has become quickly outdated. Electronic wills, witnessing and e-notarization has helped though is not uniform throughout the country. Relying on another state’s statutes where you can make them work in your favor may be a band-aid type fix but is not feasible for the long run.

It is evident that the use of electronic wills and other estate planning documents should be on the forefront of each state’s legislative agenda in the future. The days of wet signatures and hard copy documents have become outdated and are nearly impossible to execute in the times of social distancing.